VIENNA, June 9 (Reuters) - Austria’s central bank has raised its forecasts for economic growth in the country this year and next, saying accelerating exports and robust consumer spending would lift gross domestic product.
In its half-yearly overall economic outlook published on Friday, the Austrian National Bank (ONB) increased its GDP growth forecast for this year to 2.2 percent from 1.5 percent predicted in December, and raised its estimate for 2018 to 1.7 percent from 1.5 percent.
“The Austrian economy’s prospects for 2017 have improved significantly,” ONB Governor Ewald Nowotny said in a statement. “Austria’s growth will be stronger than that of the euro area this year for the first time since 2013,” he added, without providing a forecast for the rest of the euro zone.
The ONB forecast that exports in the trade-dependent country would grow 4.2 percent this year, more than double the rate recorded last year, helped by improving economic conditions in trade partners including the United States and the euro zone.
A fiscal reform that reduced most households’ tax burden as of last year would continue to support consumer spending, the central bank said.
“The Austrian economy is currently in an upswing driven both by domestic and foreign demand,” the ONB said in a statement.
The harmonised index of consumer prices (HICP) would rise 2.0 percent this year, it said, slightly less than the 2.2 percent it predicted in a quarterly inflation forecast in April. Its HICP forecast for 2018 was unchanged at 1.8 percent.
Reporting by Francois Murphy; Editing by Kirsti Knolle